Car finance consolidation help

nigpay1

Hi,
So, current situation:
£10.000 loan completion in May 2021
£5,800 left of car finance completion in 2023.
My question is when I complete payments in May (10k loan) I want to swap my car, would I be better to part ex as is so the garage pay off my finance and give me any positive equity toward the next one or pay off the remainder of the £5,800 first?
thanks

DrEskimo

Won't make any difference. Assuming of course the cars trade in value will be >£5,800 in May.

Clearing the finance will make private selling easier and you could maximise its value that way.

Of course the real question is whether it's sensible to change cars at all? Be far more MSE to overpay on your car finance as fast as possible and then keep it with no debts.

Carl2510

Obviously paying either a balloon payment or a final payment at the end and keeping the car will save you lots of money in the long run, but if you do decide to give it back I’ve always found selling it probably with someone like We Buy Any Car you do get a better value than the dealership. And then you can usually pay off the finance and have something left over to put a deposit down on a new car.